'Phased retirements' more popular

Amid the economic turmoil, interest in phased retirement is on the rise. The Wall Street Journal reports that for employees, these programs offer a way to ease rather than plunge into retirement, which can pay psychological and financial dividends.

"Many employers are introducing phased-retirement programs to prepare for mass retirements among baby boomers, an eventuality the recession has only delayed. The goal: to persuade near-retirees to stick around long enough to teach colleagues how to do their jobs."

The paper says other employers are implementing these programs to pare payroll costs while minimizing layoffs. In a survey released in July, the nonprofit Families and Work Institute in New York found that 77 percent of 400 employers contacted had taken steps to reduce their labor and operation costs during the previous 12 months. Of those, 7 percent said they were relying on phased-retirement programs.